Google to Charge Small Businesses for Apps Software

Google Apps
Google Apps

Google will no longer offer its Web-based office productivity software free to small businesses, the Internet company's latest move to expand revenue beyond its core advertising services.

Google said on Thursday that businesses with 10 or fewer people will now need to pay $50 per user per year—the same rate that larger businesses pay—to use its Google Apps software which includes email, word processing, spreadsheet and presentation tools. (Read more: Amid 'Fiscal Cliff' Stalemate, Main Street Deteriorates)

The change will let Google offer a more consistent service to business customers, the company said in a post on its company blog.

"Businesses quickly outgrow the basic version and want things like 24/7 customer support and larger in boxes," Google said. (Read more: Staples Launches Online Small Business Group With LinkedIn)

Google Beefs Up Enterprise Business

Individual consumers will still be able to get a free version of many of the products, such as Gmail, Google said. Andexisting business customers who use the free version will continue to get it for free, though they will not receive the additional services included in the premium version.

More than 5 million businesses use Google's Apps, Google said earlier this year, though it did not distinguish between customers who use the free or paid versions.

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The move marks the latest change to Google Apps, which until 2011 was available for free to businesses with 50 or fewer people. In June, Google launched the Google Compute Engine, which provides online computing services to a limited set of customers. Google, the world's No.1 Web search engine, generates thebulk of its revenue from online advertising.

Google does not disclose the revenue that its so-called enterprise business generates, but the company has signaled its hopes that it will become an important part of Google's overall business. In July, Google Senior Vice President and Chief Business Officer Nikesh Arora described the enterprise business as a "future growth engine" for Google.